Cardlytics 2025 Q1 Earnings Improved EPS Amid Declining Revenue

Cardlytics (CDLX) reported its fiscal 2025 Q1 earnings on May 07th, 2025. Despite a decrease in revenue, Cardlytics surpassed EPS expectations with a loss of $0.21 per share against a forecasted $0.27 loss, marking a 22.22% earnings surprise. The company provided a guidance update, projecting Q2 2025 revenue between $61.0 million and $67.0 million, representing a year-over-year decline of 12% to 4%. Analysts will closely monitor how these projections align with future outcomes, especially considering prior performance.

Revenue

Cardlytics experienced an 8.4% drop in total revenue to $61.90 million in Q1 2025, compared to $67.61 million in Q1 2024. The Cardlytics platform generated $56.44 million, while the Bridg platform contributed $5.46 million, culminating in a total of $61.90 million.

Earnings/Net Income

Cardlytics reported a narrowed loss per share, improving from $0.56 in Q1 2024 to $0.26 in Q1 2025. The net loss decreased significantly to $13.28 million, a 45.3% reduction from the $24.27 million loss in the previous year, showing positive progress.

Price Action

The stock price of Cardlytics remained flat during the latest trading day but showed a robust increase of 50.00% over the past week and a 54.29% surge month-to-date.

Post-Earnings Price Action Review

Over the past five years, the strategy of purchasing Cardlytics shares following a revenue drop and holding them for 30 days has delivered mixed results. While there were some short-term gains, the overall trend was negative, underperforming the market. For instance, in May 2020, the stock dropped by 41.6% in the subsequent 30 days but rebounded by 46.1% the following year. Similarly, other periods showed initial declines followed by partial recoveries. This approach yielded an annualized return of 1.4%, significantly below the S&P 500's 6.8%. Investors must weigh the potential for rebounds against the inherent risks and volatility, considering their risk tolerance and investment horizon.

CEO Commentary

"We've made marked progress across our key business pillars, which continue to underpin our journey to 'platformize' Cardlytics and position ourselves as the leading commerce media platform," said Amit Gupta, CEO of Cardlytics. He highlighted the company's expanding ecosystem and data depth, as well as ongoing technology investments that are enhancing value for partners and advertisers. Gupta noted that the company is making strategic decisions to strengthen its resilient platform and future-proof its business, emphasizing a disciplined approach to cost management amid these investments.

Guidance

Cardlytics anticipates Billings for Q2 2025 to range from $100.0 million to $108.0 million, reflecting a year-over-year decline of 9% to 2%. Revenue is expected between $61.0 million and $67.0 million, representing a decrease of 12% to 4%. The company projects Adjusted Contribution to be between $32.5 million and $36.5 million, showing a decline of 11% to no change, while Adjusted EBITDA guidance is set at a range of $(4.0) million to $1.0 million, indicating an expected improvement of $(1.7) million to $3.3 million from the prior period.

Additional News

In recent weeks, Cardlytics has been active with strategic initiatives beyond earnings. The company announced new partnerships aimed at expanding its platform capabilities, enhancing its position as a leading digital advertising platform. Additionally, Cardlytics appointed a new Chief Financial Officer to spearhead financial strategies and drive the company's growth. There has been no news of mergers or acquisitions, but the company's focus on organic growth and strengthening its core business remains evident. These developments align with Cardlytics’ strategy to leverage its existing strengths and explore new market opportunities.